ENERGY

Obama Threads the Needle With Drilling Plan

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U.S. Interior Secretary Ken Salazar speaks about his department's clean energy initiatives at the American Wind Energy Association's annual Offshore Wind Power Conference in Baltimore, Tuesday, Oct. 11, 2011. U.S. Salazar said the nation's second offshore wind power lease could be weeks away. (AP Photo/Patrick Semansky)  
National Journal
Olga Belogolova
Nov. 9, 2011, 9:45 a.m.

Nobody is really happy with the Obama ad­min­is­tra­tion’s new five-year oil-and-gas drilling plan, which took a few steps back from the pres­id­ent’s pre-BP-spill drilling pro­pos­al of 2010 but also a few steps for­ward from what en­vir­on­ment­al­ists wanted by al­low­ing more ex­plor­a­tion off the coast of Alaska. But neither is any­one really all that angry about the new pro­pos­al, which In­teri­or Sec­ret­ary Ken Salaz­ar un­veiled on Tues­day.

“There’s people un­happy on both sides, which is usu­ally a sig­nal that there’s a fairly reas­on­able bal­ance,” Mi­chael Conath­an, dir­ect­or of ocean policy at the Cen­ter for Amer­ic­an Pro­gress, told Na­tion­al Journ­al.

“They’ve man­aged to put something out there that every­body can hate,” he said.

The plan to open up the Beaufort and Chuk­chi seas and the Cook In­let in Alaska, as well as more areas in the Gulf of Mex­ico, brought swift re­ac­tions from law­makers, in­dustry rep­res­ent­at­ives, and en­vir­on­ment­al act­iv­ists. The com­mon theme: dis­ap­point­ment.

Erik Milito, group dir­ect­or of up­stream and in­dustry op­er­a­tions at the Amer­ic­an Pet­ro­leum In­sti­tute, had hoped for a broad­er reach, but still called the plan “a good first step.”

“Des­pite our dis­ap­point­ment with this trimmed down leas­ing pro­gram, we will con­tin­ue to seek more ro­bust off­shore lease sales in the fu­ture,” Milito said in a state­ment, ur­ging the ad­min­is­tra­tion to re­con­sider its ex­clu­sion of areas off the coast of Vir­gin­ia and else­where along the East­ern sea­board.

Demo­crat­ic Sen. Mark Warner of Vir­gin­ia echoed those re­marks.

“This is dis­ap­point­ing, be­cause the safe, re­spons­ible de­vel­op­ment of off­shore en­ergy re­sources has broad sup­port from Vir­gini­ans and among the bi­par­tis­an elec­ted lead­er­ship of the state,” Warner said in a state­ment, also ex­press­ing hope that the ad­min­is­tra­tion would re­con­sider more coastal drilling be­fore is­su­ing a fi­nal plan when the cur­rent one ex­pires next June.

En­vir­on­ment­al­ists, as ex­pec­ted, were pleased with In­teri­or’s de­cision to rule out de­vel­op­ment along the At­lantic Coast, but ex­pressed dis­ap­point­ment in the ad­min­is­tra­tion’s plans to leave de­vel­op­ment off the coast of Alaska on the table.

The plan calls for one lease sale in 2015 in the Beaufort Sea, one lease sale in 2016 in the Chuk­chi Sea, and one spe­cial-in­terest sale in the Cook In­let.

“While we in­clude the Chuk­chi and the Beaufort seas, we have put off any po­ten­tial sales un­der that plan un­til later in the peri­od,” Deputy In­teri­or Sec­ret­ary Dav­id Hayes said at the un­veil­ing. “Our ap­proach is to use the in­ter­ven­ing years to bet­ter ad­dress the sci­ence gaps.”

Des­pite the buf­fer that In­teri­or gave it­self with those lease sales, en­vir­on­ment­al­ists still ques­tioned the de­cision.

“BOEM has taken one step for­ward by bet­ter tar­get­ing lease sales,” Oceana Pa­cific seni­or coun­sel Mi­chael LeV­ine said in a state­ment, re­fer­ring to In­teri­or’s Bur­eau of Ocean En­ergy Man­age­ment. “At the same time, it has taken two steps back­ward by com­mit­ting to lease sales in the Chuk­chi and Beaufort seas.”

The mixed re­views from all sides demon­strate the ways in which the ad­min­is­tra­tion had man­aged to straddle the line with this an­nounce­ment, just as it was hop­ing.

“Fun­da­ment­al to the pro­posed pro­gram is strik­ing the right bal­ance between the be­ne­fits of re­source de­vel­op­ment, in­clud­ing the eco­nom­ic and em­ploy­ment be­ne­fits of re­source de­vel­op­ment, with the im­per­at­ives of en­vir­on­ment­al pro­tec­tion,” said Tommy Beau­dr­eau, the head of BOEM.

Even House Nat­ur­al Re­sources Com­mit­tee rank­ing mem­ber Ed­ward Mar­key, D-Mass., a long­time drilling crit­ic, praised the ad­min­is­tra­tion’s bal­anced ap­proach.

“The Obama ad­min­is­tra­tion’s plan would con­tin­ue to pro­mote oil and gas pro­duc­tion, but re­cog­nizes that safety meas­ures need im­prove­ment, es­pe­cially in the harsh con­di­tions in Alaska,” Mar­key said in a state­ment.

Still, the pro­pos­al rep­res­ents a scaled-back ap­proach for the Obama ad­min­is­tra­tion. Be­fore the BP spill in April 2010 sent nearly 4.9 mil­lion bar­rels of oil in­to the Gulf of Mex­ico, Obama floated a drilling plan that was far more am­bi­tious.

Just a month be­fore the spill, Obama pro­posed leas­ing areas off Alaska’s coast, but also off the At­lantic Coast and fur­ther in­to the east­ern Gulf of Mex­ico. The plan was in­ten­ded to re­duce for­eign-oil de­pend­ence and gen­er­ate rev­en­ue from the sale of off­shore leases, and at the time, Obama was also seek­ing con­ces­sions from Re­pub­lic­ans and mod­er­ate Demo­crats on com­pre­hens­ive cli­mate le­gis­la­tion that was to be taken up by the Sen­ate a few weeks later.

“We need to move bey­ond the tired de­bates of the left and the right, between the busi­ness lead­ers and en­vir­on­ment­al­ists, between those who would claim drilling is a cure-all and those would claim it has no place,” Obama said in a speech pro­mot­ing his plans on March 31, 2010. But the BP spill that began a few weeks later blew those plans out of the wa­ter.

Some of the ideas for open­ing areas in the At­lantic and Arc­tic were sim­il­ar to those floated by Pres­id­ent George W. Bush while he was in of­fice, but Obama’s 2010 plan still held back from open­ing Alaska’s Bris­tol Bay, the Pa­cific Coast, and areas north of New Jer­sey along the At­lantic Coast.

The plan re­leased on Tues­day scales that back even more. Even though In­teri­or said the five-year plan would open up more than 75 per­cent of po­ten­tial re­sources through 15 lease sales in six off­shore areas, the pro­pos­al doesn’t in­clude any­thing off the At­lantic Coast nor in parts of the east­ern Gulf of Mex­ico that are still un­der a con­gres­sion­al ban. Spe­cific­ally, the new pro­posed areas in­clude five an­nu­al lease sales to be­gin in the fall of 2012 in the west­ern Gulf of Mex­ico; five an­nu­al lease sales be­gin­ning in the spring of 2013 in the cent­ral Gulf; and two lease sales in 2014 and 2016 in areas of the east­ern Gulf that are not un­der the ex­ist­ing morator­i­um.

Though Obama’s more-am­bi­tious plans in the spring of 2010 were tempered by the BP spill, Jac­queline Savitz, Oceana’s seni­or cam­paign dir­ect­or, said the new pro­pos­al “is still a big con­ces­sion to the in­dustry.

“I think the spill really opened people’s eyes. I’m sur­prised, though, at how short our memor­ies are,” she ad­ded.

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